Judge's ruling could boost rents in Santee

Mobile-home parks sue to undo city's controls

Rents at Santee's mobile-home parks could rise after a judge ruled in favor of a park owner in a lawsuit challenging the city's rent-control ordinance.

In a tentative decision released this week, the Superior Court judge struck down the latest version of the law, which was adopted by the Santee City Council in 1998 and amended in 2000. The original rent-control ordinance, passed in 1994, remains in effect.

Judge J. Richard Haden determined city employees failed to follow proper procedure when they presented the ordinance to the council for approval. He also allowed Manufactured Home Communities to recoup from tenants the rent it lost over the past 26 months under the flawed law.

The repealed ordinance used a formula based on 70 percent of the rise in the U.S. Consumer Price Index to cap rent increases. The court's ruling puts the original formula, which uses 100 percent of the index, back in effect.

The city has two weeks to file paperwork to persuade the judge to change his ruling. About 4,000 mostly low-income, elderly residents live in Santee's 12 parks and benefit from rent control.

MHC General Counsel Ellen Kelleher said the company is analyzing the decision but could not say how it will affect rents.

Marian La Rocca, president of the Homeowner's Association of Meadowbrook Mobile Estates, is estimating an increase of $5 per month. Yet she worries MHC will ask for the past rent in a lump sum, which she estimated could amount to hundreds of dollars.

"There are several people here who are barely making it now," said La Rocca. "This might break them."

Mayor Randy Voepel, who supports rent control, wondered whether the city can afford to keep fighting. Court papers show the city already has spent more than $1 million, and the judge struck down a fee that went toward a legal defense fund.

"I'm going to have to closely analyze whether we have a chance of prevailing," Voepel said.

Santee adopted its first rent-control ordinance in the mid-1980s. The one in effect now, adopted in 1994, rolled back rents to 1989 levels and tied increases to the consumer price index formula.

In 1998, a group of residents from mobile-home parks sought to tighten the ordinance, claiming it had too many loopholes that owners were exploiting. The citizens circulated a petition to place the changes on the November ballot.

The City Council got ahead of the process and adopted the ballot measure as law just before the election. The problem, the judge's recent ruling says, is what the council adopted was not what was circulated to the public. He blamed city employees for failing to verify the language.

In 2000, the council tried to rectify the error by amending the original ordinance. But Judge Haden ruled the correction was also invalid because of the flaws in the original law.

"The city failed to conform to the custom and practice for processing initiative petitions," Haden wrote.

MHC, which owns three other parks in the county, said it plans to continue fighting the ordinance. Kelleher argued it is illegal to impose blanket rent control on the park. If rent control must exist, the company prefers a system that allows rents to reach market prices after a tenant vacates a space.

MHC estimates the price would be $850 per month at Meadowbrook, about $200 more than what tenants pay, according to a letter the company sent to tenants in September 2002.